scholarly journals The Modigliani–Miller Theory with Arbitrary Frequency of Payment of Tax on Profit

Mathematics ◽  
2021 ◽  
Vol 9 (11) ◽  
pp. 1198
Author(s):  
Peter Brusov ◽  
Tatiana Filatova
Keyword(s):  
Income Tax ◽  
Weighted Average ◽  
Financial Indicators ◽  
Tax Legislation ◽  
Company Value ◽  
Equity Cost ◽  
Tax Payments ◽  
Arbitrary Frequency ◽  
Further Development ◽  
A Company

The main purpose of the current study is the generalization and further development of the Modigliani–Miller theory taking into account one of the conditions of the real functioning of companies for the case of paying income tax with an arbitrary frequency (monthly, quarterly, semi-annual or annual payments). While a return is not required more than once a year, businesses may be responsible for filing estimated taxes based on profits earned. This requirement is dependent on showing a profit. For example, sole proprietors must file estimated taxes on profits quarterly, on the 15th day of April, June, September and January. In Russia, tax on profit payments could be made annually, quarterly, or monthly. We suppose, that more frequent payment of income tax impacts on all main financial indicators of the company and leads to some important consequences. We use analytical and numerical methods: we derive all main formulas of the modified Modigliani–Miller theory theoretically and then use them to obtain all main financial indicators of company and their dependences on different parameters by MS Excel. We show that: (1) all Modigliani–Miller theorems, statements and formulas change; (2) all main financial indicators, such as the weighted average cost of capital (WACC), company value, V, and equity cost, ke, depend on the frequency of tax on profit payments; (3) in the case of income tax payments more than once per year (at p ≠ 1), as takes place in practice, the WACC, company value, V and equity cost, and ke start depend on debt cost, kd, while in ordinary (classical) Modigliani–Miller theory all these values do not depend on kd; (4) obtained results allow a company to choose the number of payments of tax on profit per year (of course, within actual tax legislation): more frequent payments of income tax are beneficial for both parties, for the company and for the tax regulator.

scholarly journals Market value calculation and the solution of circularity between value and the weighted average cost of capital WACC

2009 ◽  
Vol 10 (6) ◽  
pp. 101-131 ◽  
Author(s):  
Ignacio Vélez-Pareja ◽  
Joseph Tham
Keyword(s):  
Average Cost ◽  
Cost Of Capital ◽  
Weighted Average ◽  
Cost Of Debt ◽  
Cost Of Equity ◽  
Tax Rate ◽  
Market Values ◽  
Equity Cost ◽  
Tax Payments ◽  
The Cost

Most finance textbooks present the Weighted Average Cost of Capital (WACC) calculation as: WACC = Kd×(1-T)×D% + Ke×E%, where Kd is the cost of debt before taxes, T is the tax rate, D% is the percentage of debt on total value, Ke is the cost of equity and E% is the percentage of equity on total value. All of them precise (but not with enough emphasis) that the values to calculate D% y E% are market values. Although they devote special space and thought to calculate Kd and Ke, little effort is made to the correct calculation of market values. This means that there are several points that are not sufficiently dealt with: Market values, location in time, occurrence of tax payments, WACC changes in time and the circularity in calculating WACC. The purpose of this note is to clear up these ideas, solve the circularity problem and emphasize in some ideas that usually are looked over. Also, some suggestions are presented on how to calculate, or estimate, the equity cost of capital.

scholarly journals ANALYSIS AND EVALUATION OF FISCAL POLICY IN LATVIA

2019 ◽  
Vol 2 ◽  
pp. 184
Author(s):  
Erika Zubule ◽  
Peter Grabusts
Keyword(s):  
Fiscal Policy ◽  
Income Tax ◽  
Policy Instruments ◽  
Corporate Income Tax ◽  
Simulation Methods ◽  
Financial Indicators ◽  
Potential Influence ◽  
State Budget ◽  
Analysis And Evaluation ◽  
Tax Payments

The choice and topicality of the research topic is based on the fact that upon strengthening of the government's regulating role in economy, the notion of public finances positions itself, and state budget has become an important subject of both economic and political discussions as implementation of fiscal policy is takes place through it. In order to evaluate fiscal policy, it is necessary to evaluate the potential influence of different fiscal policy instruments on social and economic situation in the state. Aim of the research – to evaluate activities of fiscal policy implemented in Latvia in context of certain tax, namely, influence of corporate income tax on state's economic and financial indicators, identifying the main risks and imperfections of fiscal policy when ensuring state's budget. Applying simulation methods in the environment of Matlab/Simulink, the authors analyze and evaluate the influence of fiscal decisions and their implementation on the situation in Latvia, analyzing the most important tendencies in the sphere of corporate income tax payments according to the tax reform commenced in 2018.

scholarly journals ANALISIS PERHITUNGAN PAJAK PENGHASILAN PASAL 25 PADA PT. SURYA FAJAR MAS MANADO

2020 ◽  
Vol 15 (2) ◽  
pp. 77
Author(s):  
Ryan Yngwie Mamahit ◽  
Harijanto Sabijono ◽  
Stanley Kho Walandouw
Keyword(s):  
Quantitative Study ◽  
Income Tax ◽  
The State ◽  
Corporate Income Tax ◽  
General Fund ◽  
Tax Laws ◽  
Tax Payments ◽  
A Company

Tax is main source of revenue for financing all govermental expenditures, both in terms of development and activities related to the interests of the country. Used also for general fund expenses related to the duty of the state to govern. PT. Surya Fajar Mas is a company engaged in the construction field. Company made tax payments, one of which is that the corporate income tax income tax Article 25. This study aims to determine the calculation, depositing, and reporting of income tax Article 25 on PT. Surya Fajar Mas. This study used a quantitative study. The result shows that the calculation of income tax artile 25 at PT. Surya Fajar Mas was correct and in correcting the fiscal in accordance with the applicable tax laws. It is recommended that both operasional and administrative and general as well as other expenses should be substantiated with strong and valid evidance.

scholarly journals Electronic platform operators as participants of tax relations in the digital era (the case of professional income tax)

2020 ◽  
Vol 4 (4) ◽  
pp. 56-67
Author(s):  
Olga I. Lyutova
Keyword(s):  
Income Tax ◽  
Legal Status ◽  
Tax Legislation ◽  
Digital Era ◽  
Complicated Process ◽  
The Subject ◽  
The Russian Federation ◽  
Definition Of ◽  
Tax Reporting ◽  
Further Development

The subject. The research concerns analysis of legal status of a new participant of tax relations in the digital era - an operator of electronic platform. The purpose of the article is to confirm or disprove hypothesis that operators of electronic platforms are participants of tax relations and their rights and obligations must be described in tax legislation. The research methodology includes an interpretation of tax legislation, other legal acts governing the legal status of operators of electronic platforms, analysis of rights and obligations of other participants of tax relations. The main results and scope of their application. Due to the lack of an unambiguous definition of the legal status of operators of electronic platforms, obstacles are existed in the use of the transactional principle to taxation in case of professional income tax in Russia. Administration of this tax implies a complete absence of tax reporting as well as an unusual moment of the payment of this tax - at the time of the transaction, when self-employed taxpayer receives payment for his services by a consumer. This mechanism eliminates the unnecessarily complicated process of notifying the tax authorities about such transactions, but implies additional obligations to the operators of electronic platforms and the taxpayers themselves. It actualizes the necessity of detailed description of legal status of the operators of electronic platforms in tax legislation. Conclusions. The legal status of operators of electronic platforms in terms of belonging to the participants in tax relations already provided for in the Tax Code of the Russian Federation is not defined. Although they act as intermediaries in calculating and paying professional income tax. Such a lack creates a number of practical problems and does not contribute to the development of a transactional approach to taxation. At the present stage, it would be logical to recognize the operators of electronic platforms as tax representatives of taxpayers or withholding agents. According to the further development of the technical capabilities of tax administration, operators of electronic platforms may become a new participants of tax relations, who are conventionally called by the author «technological intermediaries».

scholarly journals ANALISIS PERENCANAAN PAJAK DALAM PERHITUNGAN PAJAK PENGHASILAN BADAN PADA PT. SINAR CIPTA PERSADA SEJATI

2019 ◽  
Vol 14 (4) ◽  
Author(s):  
Blandina Sefrida Kenju ◽  
Inggriani Elim ◽  
Rudy J Pusung
Keyword(s):  
Income Tax ◽  
Tax Planning ◽  
Corporate Income Tax ◽  
Corporate Tax ◽  
Tax Legislation ◽  
Tax Payments

 The purpose of this study was to determine the application of tax planning in calculation the corporate income tax owed at PT. Sinar Cipta Persada Sejati. The results of this study are expected to be able to provide information and input to the company PT. Sinar Cipta Persada Sejati so that companies can carry out tax planning in an effort to calculation tax payments, but still in income tax legislation No. 36 of 2008. With the implementation of tax planning by the company, it can calculation the burden of corporate tax payable as much as Rp. 2,500,000.

PENGARUH MANAJEMEN ASET DAN PERTUMBUHAN PERUSAHAAN TERHADAP NILAI PERUSAHAAN (Studi Kasus pada PT. Tambang Batubara Bukit Asam Tbk. dan PT. United Tractors Tbk.)

2019 ◽  
Vol 7 (02) ◽  
pp. 79
Author(s):  
Syarief Gerald Prasetya
Keyword(s):  
Asset Management ◽  
Research Process ◽  
Positive Development ◽  
Company Value ◽  
A Company ◽  
Assets Management

 Company's goal is to maximize the value of the company. Value of the company is very important for the company because the company maximize the value it will maximize the welfare of shareholders. Efforts that can be done to maximize the value of the company in one of the company through asset management. Asset management companies is an activity which is very important because the management is based on the size of the success of the company during a certain period can be known. Asset management is a potential that is owned by organizations or individuals to achieve the vision, mission and goals, or particular. However, in maximizing the value of a company diisyaratkan a growth company that is a positive development of the company that occurred in a period of timeThe aim of this research is to analyse relevantly of assets management and growth of company, is have influence and relation, or not with value of company. If in research process found by inexistence of relation and influence from assets management and growth of company, so will searching that problem and searching the othe factors perhaps existence relation and influence to value of companiesThe research shows that in PT. Tambang Batubara Bukit Asam Tbk, influential assets management according to significant towards value of companies, that is with level significant as big as 0,012. While in PT. United Tractors Tbk, assets management not influential according to significant towards value of companies, that is with level significant as big as 0,576. In PT. Tambang Batubara Bukit Asam Tbk, influential growth of company according to significant towards value of companies, that is with level significant as big as 0,015. While in PT. United Tractors Tbk, growt of company not influential according to significant towards value of companies, that is with level significant as big as 0,870Result of evaluation in this research is that value of companies do not only be influenced by factor of assets management and growth of company, but there is other factor which can influence such as profitability factor and and efficiency costKey word: management assets, growth of company, value of company

scholarly journals Decision Making for Project Appraisal in Uncertain Environments: A Fuzzy-Possibilistic Approach of the Expanded NPV Method

Symmetry ◽  
2020 ◽  
Vol 13 (1) ◽  
pp. 27
Author(s):  
Konstantinos A. Chrysafis ◽  
Basil K. Papadopoulos
Keyword(s):  
Net Present Value ◽  
Fuzzy Numbers ◽  
Cost Of Capital ◽  
Weighted Average ◽  
Present Value ◽  
Major Drawback ◽  
Project Appraisal ◽  
Equity Cost ◽  
Set Up ◽  
Intelligent Methods

The major drawback of the classic approaches for project appraisal is the lack of the possibility to handle change requests during the project’s life cycle. This fact incorporates the concept of uncertainty in the estimation of this investment’s worth. To resolve this issue, the authors use fuzzy numbers, possibilistic moments of fuzzy numbers and the hybrid (fuzzy statistic) fuzzy estimators’ method in order to introduce a fuzzy possibilistic version of the expanded net present value method (FPeNPV). This approach consists of two factors: the fuzzy possibilistic NPV and the fuzzy option premium. For the estimation of the fuzzy NPV, some basic assumptions are taken into consideration: (1) the opportunity cost of capital, used as the present value interest factor calculated through the weighted average cost of capital (WACC), (2) the equity cost, determined through the possibilistic set-up of the capital asset pricing model CAPM, and (3) the inflation factor, also included in the estimation of the NPV. The fuzzy estimators’ method is used for the computation of the fuzzy option premium. An algorithm of nine major steps leads to the computation of the FPeNPV. This gives the administration the opportunity to adapt to potential changes in the company’s internal and external environments. In this way, the symmetry between the planning and execution phase of a project can be reinstated. The results validate the statement that fuzzy and intelligent methods remain valuable tools to express uncertainty in various scientific areas. Finally, an illustrative example aims at a thorough comprehension of this new approach of the expanded NPV method.

scholarly journals A NEW CONCEPTUAL MODEL FOR THE DEVELOPMENT OF PROCESS TECHNOLOGY IN PROCESS INDUSTRY: A POINT OF DEPARTURE FOR THE TRANSFORMATION OF THE "PROCESS DEVELOPMENT PROCESS" INTO A FORMAL WORK PROCESS?

2000 ◽  
Vol 04 (03) ◽  
pp. 319-346 ◽  
Author(s):  
THOMAS LAGER
Keyword(s):  
Conceptual Model ◽  
Development Process ◽  
Process Development ◽  
Process Industry ◽  
Process Technology ◽  
Work Process ◽  
Starting Point ◽  
Three Phase ◽  
Further Development ◽  
A Company

In an exploratory survey to R&D managers in different sectors of European Process Industry, the importance and present use of a formal work process for process development has been studied. A new conceptual three-phase model for the "process development process", including the identification of production needs, process development and transfer of results to production, was also tested. The results show that only 44% of the companies in the study presently use a formal work process for process development, but the need for such a process is considered to be high. Good support was given for the new conceptual model as a starting point for further development of a company-specific "process development process".

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